1. Aging buildings on the market
Aged office buildings are those built more than 15 years ago. The total area of those buildings in Warsaw exceeds 1.85 million square meters, which is more than one third of the total office space in Poland’s capital.
According to the global real estate services firm Cushman & Wakefield, almost 500 modern office buildings operated in Warsaw at the end of 2017, of which 195 (39%) were over 15 years old. The vacancy rate in these buildings at the end of the year totalled 10.2%, and their share in the vacancy rate for the whole of Warsaw was over 30%.
By the end of 2020, the number of buildings aged 15 years or more could have risen to 36%. The growing number of office buildings and the relatively intense competition on the office market make it a real challenge for the owners to reach a high lease rate. At the same time, however, these circumstances open a wide field of opportunity to marketing experts.
2. Challenges faced by office building owners
In addition to the building and its technological solutions, the aging process also affects the very image of the property (the perception of the building, its visual identification) which is of vital importance for tenants when making a decision on their choice of a new office. Older buildings are usually compared with planned projects or newly built properties which, apart from their modern architectural and functional solutions, can boast a coherent visual identification and a well-schemed aggressive communication strategy as their owners enter the market with an ‘attractively packaged’ finished product. Furthermore, new properties offer various types of amenities in keeping with the trend that sweeps the market to provide employees with the best possible and the most comfortable work conditions that help them maintain a proper work-life balance.
As the market develops and, accordingly, the needs and expectations of tenants evolve progressively, introducing new solutions in aged buildings becomes a must. Modernisation and image facelift gives them a chance for a second life and an opportunity to compete with newer properties. A full rebranding is still a novelty on our domestic office market, though many such projects have been launched with huge success abroad in cities such as London, Paris, Brussels or New York.
3. Full office building rebranding
The rebranding strategy should be based on research into the needs of potential tenants and their employees, conducted before commencement of modernisation works. It is only then that we can be certain that the changes we are planning to implement will meet the expectations of our target group.
Office building facelift and rebranding is a holistic process embracing a few areas, therefore, it is very important for the marketing specialist to take part in the whole process right from the start and to work in close collaboration with the architect, project management and sales departments. With an insight into the planned modifications and improvements, the marketing specialist will be able to develop the right strategy to rebrand and reposition the property on the market, custom-tailored to the degree of property facelift and the strategy adopted by the owner.
It is particularly important when designing a new logo for the building, and owners quite often make a decision to proceed with such a change.
The marketing team and the architect in charge of the investment project that involved renovation of common areas in an office building collaborated closely for instance during the facelift of the Zebra Tower. Its commercialization was commissioned to an international advisers, Cushman & Wakefield. Our cooperation produced a completely new logo which has been created taking into account, already at the design phase, the materials to be used for its construction, the manufacturing method and its exact location on the building. The scope of rebranding is correlated with the degree of property facelift, i.e. the more modifications to the building, the greater the need to transform its image and launch a new communication strategy.
4. Refreshing the image of the property by changing or adding new functions
Quite often the facelift project provides for the building to obtain for instance a green certificate or to offer a number of additional, previously unavailable functions.
Showrooms are often opened in older buildings to present high-profile office space to be available after its facelift so the prospective tenants can then have a real-life experience of their future offices. This space can of course be used for marketing communication as well, for example for sales presentations, social media campaigns or production of marketing collaterals such as brochures or websites.
The surroundings of the building including the adjoining greenery, elements of small architecture, space for chic food trucks, public space or event venues may be developed. Thanks to those changes backed up by a well-managed marketing campaign, the image of the property and its perception by prospective tenants may undergo a radical change, thus enhancing the chances of rentals and giving it a profitability boost.
5. Examples of best projects
The Zebra Tower located in the very heart of Warsaw at 1, Mokotowska Street, is a good example of a successful rebranding. Cushman & Wakefield experts responsible for this project developed a new visual identity that fully reflects the new refreshed image of the building and the adopted rental strategy. Further on, marketing collaterals including a brochure, presentation and a website as well as a coordinated brief info for tenants and draft emailing have been developed to support the sales process. Elements of the new branding were incorporated into the scenery at the venue of the opening event during which the new face of the office building was presented.
Yet another example of a very successful makeover and rebranding of an office building is the Adgar Park West located at the Jerozolimskie Avenue in Warsaw. The building underwent an out-and-out metamorphosis including expansion and development of a new sports and leisure zone. In this case, rebranding also embraced the change of name, since the Investor decided to bring a wholly new product to market.
The owner of the Warsaw Trade Tower office building took an unconventional approach to marketing. The property underwent modernisation of the building’s common areas and gained a number of additional functions, such as the an activity and leisure room, electric cars, a common dining room and a conference & event space. The owner also invested in the building’s surroundings making them more welcoming. The conjoining element of the facelift project was a modern logo and visual identification reflecting the new image of the building.
In addition to an extensive facelift, property owners often make a decision to refresh the image and identification of the property when one of key tenants moves out and the property is about to re-enter the rental market. This strategy pays off, too. On the other hand, there is no point to invest in refreshing the visual identity of a property without a valid reason as it will not generate incremental rental revenue. The most important and appealing message for tenants is property facelift while the task of the marketing team, through the use of the right tools, is to communicate the change, inform prospective tenants of the new advantages of the building and present the new upgraded product.
Well, now, will it pay off to invest in marketed rebranding as a backing for the property facelift process? Definitely yes. Without marketing, the makeover will not be communicated effectively and the new improved product will not enter the market.
Effectively implemented rebranding strategy will boost rentals, which may enhance increment in value of the property as the investment product. When making decisions on renting or buying real estate, investors and tenants are driven by emotional reactions and it is precisely marketing effort that can influence the emotional processes of prospective clients. Repositioning of the building on the market can improve tenant retention, attract prospective tenants and place the property on equal footing with much newer competition.
Property Marketing Manager
Cushman & Wakefield